Australian markets performed over the past week

It looks like it was a solid week on the ASX, with gold leading the way.

That’s a reasonable summary, though the 4.2 per cent rise in the gold index that we enjoyed this week was driven largely by one company, Newcrest (NCM). Because it is easily Australia’s biggest gold miner, Newcrest dominates the index. Last week’s five per cent rise to A$39.02 put the rest of the gold sector in the shade, and re-kindled speculation of a bid for Newcrest by one of the global gold majors. That talk has been aided by the sudden resignation earlier this month of Newcrest’s chief executive, Ian Smith, a departure which was not accompanied by a satisfactory explanation.

Meaning there might be a boardroom struggle underway?

It’s possible, and that makes Newcrest a company to watch closely over the next few weeks. As for the rest of the Australian market, it fell well short of gold. The all ordinaries rose a modest 1.1 per cent, and the broad metals and mining index rose a slightly less modest 1.4 per cent.

Index rises which indicate minimal share price movements.

That’s true if you look primarily at the market leaders and usual suspects. A different and more interesting picture emerges when you look behind the well-known names and follow the trail of the hot money on the ASX, something we’ve been doing in recent weeks to highlight some fresh names for our London readers. This week we’ll start with a company exploring for a mineral we don’t often hear about, graphite. Shares in Archer Exploration (AXE) doubled on Friday, putting in an upward run of A16 cents to A32 cents, before easing to close at A21 cents, for an overall a gain of A8.5 cents for the week. Interest in the project was sparked by an encouraging report on the company’s Sugarloaf project on the Eyre Peninsula of South Australia, which was a source of graphite in the 19th century. And interest in the material has been raised as supplies diminish. Graphite has uses as a lubricant and in lithium-ion batteries.

Interesting. Let’s hear about a few more of the lesser-known companies before the call of the card.

The next significant mover worth mentioning is named after a company which set the mining world alight almost 40 years ago, Poseidon (POS). Back in 1969 and 1970, the original Poseidon triggered a nickel boom with its discovery at Mt Windara in Western Australia. The new Poseidon is re-working the same mine, though perhaps more scientifically. Last week’s 43 per cent rise in Poseidon’s share price to A34.5 cents was driven after the company awarded a contract to refurbish the original underground mine at Mt Windara.

Frontier Resources (FNT) was also generating plenty of interest, as its gold search in Papua New Guinea continues. Last week it added another A7.5 cents to A37.5 cents. And another explorer, Papillon Resources (PIR), a new Aussie player in the West African gold hunt, was the beneficiary of interest after a presentation at the Mining Indaba conference in Cape Town. It added A16.5 cents to A94.5 cents. Elsewhere, Cerro Resources (CJO), the old Kings Minerals, attracted interest in its Mexican silver exploration, adding A4 cents to A26 cents, while another silver stock, Cobar Consolidated (CCU) continued its upward run with a rise of A13 cents to A88 cents.

Thanks for that brief survey of the bigger moves. Let’s move through the sectors now, continuing with gold.

After Newcrest, the performance in the gold space was mixed, although the general trend was up. Ausgold (AUC) added A11 cents to A$1.65 after our report on its ambitious South Boddington exploration project. OceanaGold (OGC) recovered recently lost ground, with a rise of A31 cents to A$2.86, but did trade as high as A$3.03 on Friday. Ramelius (RMS) added A13 cents to A$1.20, and Tanami (TAM) continued its remarkable revival with a rise of A12 cents to A$1.05. Other gold companies that gained ground included Medusa (MML), up A29 cents to A$7.32, and Beadell (BDR), up A7 cents to A83.5 cents. Troy (TRY) was also better off, up A27 cents to A$3.82, as investors look past its commissioning setbacks at the new Casposo mine in Argentina. Offsetting the gains was a long list of companies that fell, including Gold Road (GOR), down A4 cents to A31.5 cents, Silver Lake (SLR), down A3 cents to A$1.89, Kingsrose (KRM), down A12 cents to A$1.33, Gryphon (GRY), down A3 cents to A$1.89, and Ampella (AMX), down A6 cents to A$2.69.

Base metals next, as copper’ still hot and there seems to be growing optimism in the nickel and zinc market.

There were a couple of copper stars, Hot Chili (HCH) and Sumatra Copper & Gold (SUM). Hot Chili, which we took a look at mid-week, added a sharp A13.5 cents to A63.5 cents, but did hit an all-time high of A70 cents on Thursday. Meanwhile, Sumatra is benefiting from its recent development decision on the Tembang gold project, and rose by A8.5 cents last week to A28 cents. The rest of the copper sector was more mixed. Companies on the rise included Discovery (DML), up A2 cents to A$1.37, Bougainville (BOC), up A7 cents to A$1.64, and Sabre (SBR), up A1.5 cents to A20 cents. Companies that fell included Equinox (ERN), down A7 cents to A$6.43, Sandfire (SFR), down A18 cents to A$7.26, and Rex (RXM), also down A18 cents to A$2.87.

Nickel companies performed reasonably well, with Poseidon in the lead. Other movers included Minara (MRE), up A3.5 cents to A90 cents, Mirabela (MBN), up A7 cents to A$2.35, Western Areas (WSA), up A64 cents to a 12 month high of A$6.90, and Panoramic (PAN), up A5 cents to A$2.47. Mincor (MCR) was also a riser, up A1.5 cents to A$1.74, but that was mainly due to a copper discovery at its Tottenham project in New South Wales.

Zinc companies also trended up, continuing a quiet recovery which has been evident for some weeks. Perilya (PEM) added A4 cents to A67 cents. Bass (BSM) rose an eye-catching A6.5 cents to A47 cents, and Prairie Downs (PDZ) put on A3.5 cents to A24.5 cents.

Iron ore and coal next, please.

There were signs of weariness in both iron ore and coal last week. Most moves were modest either way, although the overall trend in iron ore was up a little. The trend in coal was down a little. Among the leaders in iron ore, Fortescue (FMG) rose A16 cents to A$6.88 after a strong profit, maiden dividend, and a fresh legal setback for its dominant shareholder, Andrew Forrest. Brockman (BRM) added A15 cents to A$5.10, and Atlas (AGO) put on A21 cents to A$3.97. After that the moves were mainly down. Cape Lambert (CFE) lost A3.5 cents to A64.5 cents amid reports of irregular share dealing. BC Iron (BCI) fell A11 cents to A$3.11, and Iron Ore Holdings (IOH) lost A12 cents to A$1.80. Coal companies on the slide included Coal of Africa (CZA), down A4 cents to A$1.46, Macarthur (MCC), down A9 cents lower to A$12.36, and Bathurst (BTU), down A5 cents to A$1.06.

Uranium and minor metals to close.

It was mostly down among the uranium stocks. Manhattan (MHC) led the way with a fall of A15 cents to A$1.16. Paladin (PDN) lost A24 cents to A$5.08 after reporting a surprise annual loss. Berkeley (BKY) fell A7 cents to A$1.59, and Uranex (UNX) dropped by A6.5 cents to A55.5 cents.

The minor metals were all over the shop. Rare earths did best. Lynas (LYC) rose A3 cents to A$1.93. Alkane (ALK) rose A13 cents to A$1.28. However, Arafura (ARU) slipped A2 cents to A$1.26. Tin companies were weaker, as were lithium companies. South Boulder (STB) was the best of the potash plays, adding A42 cents to close at A$4.60 after it hit an all-time high of A$4.82 in early Friday trade. Atlantic (ATI) added A3 cents to A$1.93 after announcing a big fundraising for its planned redevelopment of the ill-fated Windimurra vanadium project.

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